Where to go, where not to go is the question keeps scorching your mind when you encounter the financial crisis during unemployment. Friends and family are there to help you but not for the long time when it comes to money. They have their own financial concerns, which they cannot avoid.
No doubt, availing funds emerge as the best option in such situations but with no job, it is difficult to dare to approach a lender. Does that mean, there is no way out? Perhaps not. Several choices of unemployed loans are present in the loan market and they may help you in some way. However, there are things that you need to know before submitting the loan request because, with plenty of options in the market, you may lose your focus. It can be difficult to know which one is best for you besides; there is always a fear to fall prey to faulty loan offers. Knowledge of the basics of choosing the best loan deal can really help you.
1. Stay away from the offers with hidden or upfront charges
You are looking for a loan that can help you in the tough times of financial crisis and not the one, which makes your situation severe. According to the genuine lending practices, it is not fair to charge hidden or upfront charges from the borrower. Make sure that you are not interacting with any such lender or loan company.
2. Find the short-term funding choices
Yes, you are jobless today but this is not a lifetime situation. Tomorrow, day after tomorrow or on any coming day you will get a new job. If you have some promising career opportunities in the queue, availing long-term loans is of no use. The guaranteed short term loans for unemployed can help you fill the small financial gap.
3. Know your Affordability
If you find a short-term unemployed loan suitable to your needs, then compare your affordability with its rates and repayment schedules. Why is this necessary? Because the short tenure loans are higher in rates and the reason is the absence of obligations.
You have no guarantor and collateral to present to the lender. In that case, the loan company has to secure its repayments by charging high interest rates. However, the customization facility is there, but still, these loans are comparatively higher than the guaranteed or secured funding choices. Choose the loan amount according to your repay capacity without risking your financial efficiency to repay a loan.
4. Look for the renewal policy
Renewal policy extends the tenure of the loan. In case, you feel that you may face some difficulties in paying off the loan on time and may need some extra time, this policy will help. With extended loan term, you can prevent your credit records from a drastic degrade in the credit scores. Not paying the loan on time will show on your payment history and availing funds in future can become difficult for you.
5. Know about the utility of Payment Protection Insurance (PPI)
It is natural to be caught by the fear of missed repayments. You have many fronts to fight in the name of financial obligations and while struggling with them you may fail to pay an installment. This should not happen. Right?
To prevent the borrowers from such situations, some lenders offer payment protection insurance, which ensures your monthly payments. It is an additional feature that comes with the loans for bad credit with no guarantor and no fees for unemployed. In case you fail to pay the installment, this insurance will cover it. However, how much of your loan amount is covered by the insurance totally depends on the policy of the lender and your eligibility.
These 5 tips will guide you in your expedition of searching an actually useful deal. Keep them in your mind and expect better things to happen. Make sure you have done all your research well and have found only the most suitable loan in terms of affordability. Unemployment is not so frightening if you get a timely and constructive financial solution.